REG - Oracle Power PLC - Interim Results for the 6 months to 30 June 2023
25/09/2023 07:00
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RNS Number : 4431N Oracle Power PLC 25 September 2023
25 September 2023
Oracle Power PLC
("Oracle", the "Company" or the "Group")
Unaudited Interim Results for the six months to 30 June 2023
Oracle Power PLC (AIM: ORCP), the international natural resources project
developer, announces its unaudited interim results for the six months ended
30 June 2023, which is also available on its website at:
www.oraclepower.co.uk.
Chairman's Statement for the six months to 30 June 2023
Summary of Interim Results
Oracle has made significant progress in relation to its multi-project
portfolio consisting of one gold project progressing work in Western Australia
via a joint venture, the multiple project Thar coal block in Pakistan (the
"Thar Project"), which includes a large solar project, and a very exciting
green hydrogen project in the south of Pakistan (the "Green Hydrogen
Project"). For the Green Hydrogen Project, the Company has set up a joint
venture company, Oracle Energy Limited ("Oracle Energy"), with Kaheel Energy
FZE ("Kaheel Energy"), which is wholly owned by His Highness Sheikh Ahmed Bin
Dalmook Al Maktoum.
As is to be expected for a project development company with pre-revenue
projects at development stages, the Company's financial results for the six
months to 30 June 2023 show the Group to have made a loss after taxation of
£613,773 (6 months ended 30 June 2022: £356,295). The increase in overheads
during the period of £257,478 is principally due to foreign exchange losses
and an adjustment to how the Company accounts for associate company
investments.
At 30 June 2023, the Group had cash and cash equivalents of £326,946 (30 June
2022: £762,300) and total assets less current liabilities of £6,117,075 (30
June 2022: £6,890,347).
Operational Update
Australia
The Company currently holds one prospective gold asset, the Northern Zone
Project, which is located in a globally significant gold region of Western
Australia. The Northern Zone Project is located 25km east of the major gold
mining centre of Kalgoorlie, the home of the 'Super Pit' mine which is the
second largest gold mine in Australia. At the end of 2022, we decided to spend
no further funds exploring the Jundee East mine and the carrying value of this
asset was impaired in that period.
In the Chief Executive Officer's statement contained within this report, Ms
Memon has prepared a separate operational update which further details the
Company's progress in Australia.
Pakistan
The Pakistan authorities continue to work with the Chinese Government through
the China-Pakistan Economic Corridor ("CPEC"). This will assist with the
obtaining of finance to develop Thar Block VI. We keep in close touch with
the Government of Pakistan at both federal and provincial levels to ensure the
continued support for the Thar Project.
Post period end, we received the letter of intent ("LOI") from Directorate of
Alternative Energy of the Government of Sindh relating to the establishment of
a 1,200MW hybrid solar/wind, green hydrogen/power project in Pakistan,
enabling development of the Green Hydrogen Project to commence.
In the Chief Executive Officer's statement contained within this report, Ms
Memon has prepared a separate operational update which further details the
Company's progress in Pakistan.
Conclusion
The Board extends its appreciation to the Energy Department, the Government of
Sindh, as well as the Ministry of Energy (Power Division), Government of
Pakistan, for their continued support. The Board also continues to be most
grateful for the patience and support of the Company's shareholders.
Mark W. Steed
Chairman of the Board - Oracle Power PLC
Date: 25 September 2023
Chief Executive Officer's statement for the six months ended 30 June 2023
In the first half of 2023, we have made significant progress in relation to
the development of all our projects in Pakistan and Western Australia.
Review of operations
Pakistan
Thar Block VI
As part of our continuing development of Thar Block VI, in May 2023 we signed
a strategically significant off-take and development MOU with the Government
of Sindh, K electric; the largest private electricity distributor in Pakistan,
and PowerChina International. The 1.32 MW coal to power plant will be
developed within CPEC, where it is on the priority list. The MOU allows for
the development of the power plant either on the Block VI site or at Port
Qasim for ease of transmission.
As part of our strategy to build our green energy portfolio, we also initiated
a project to develop a proposed 1GW solar facility on our mine site at Block
VI and signed a development MOU with PowerChina International. We also
obtained provisional permission from the Government of Sindh for this
development and have since commenced the necessary work to fulfil their
requirements. This project places us at the forefront of companies in the
region that are committed to developing responsible and sustainable energy
solutions. Furthermore, the solar project at Thar will also offset carbon
emissions from existing and future coal power plants, by providing green
energy to local industry and communities. Oracle also continued to work on
its CTG/L initiative during this period and, given the growing natural gas
crisis in Pakistan, the government has become more engaged with us regarding
the commencement of feasibility work.
Green Hydrogen Project
In the first half of 2023, Oracle has continued swiftly to develop its green
hydrogen project in partnership with Kaheel Energy. Significantly in March
2023, a development and financing MOU was signed with the State Grid
Corporation of China, the world's third largest company by revenue. During
this period, State Grid has commissioned and funded a Hybrid Power and
Transmission study.
We also signed two very important off-take MOUs as we continued to de-risk
this investment. The first one with Emirates Global Aluminium was signed in
February 2023, to meet the de-carbonisation needs of its aluminium smelters.
In June 2023, we continued to strengthen our off-take prospects by signing
another important off-take MOU for all our future green ammonia and green
hydrogen production along with carbon credits, with PetroChina Middle East
Company.
In February 2023, Oracle established a senior position in the green hydrogen
development universe by becoming an associate partner of Dii, Desert Energy
Alliance, a partnership network for the development and commercialisation of
green hydrogen. In March 2023, Oracle also successfully completed the award
and registration of the land lease.
In June 2023, the Company was also pleased to announce a collaboration for
project development assistance and knowledge sharing, with Global Green Growth
Institute, headquartered in Seoul under the Chairmanship of Ban ki-Moon.
Post period end, in September 2023, the Company was pleased to announce the
completion of the technical and commercial Feasibility Study relating to the
Green Hydrogen Project. The study, undertaken by leading international
construction engineering company, thyssenkrupp Uhde, supports the development
of a 400MW capacity green hydrogen production facility. The results of the
study were noted to be very encouraging and on a par with industry
expectations as observed in other green hydrogen projects announced worldwide,
providing significant confidence in the development route towards
commercialisation. The Company are now moving into a highly active period as
it works towards completing power and grid interconnectivity feasibility
studies in collaboration with State Grid Corporation of China, followed by
geotechnical and environmental studies, leading into the FEED stage, and
formulation of the investment and lender consortium.
Australia
In Western Australia, Oracle entered into a farm-in agreement for the Northern
Zone Project with Riversgold Limited ("Riversgold") (ASX:RGL), an ASX-listed
gold exploration company in May 2023. As a result of this deal, the Company
and its shareholders will be able to participate in the potential upside of
any exploration success from the Riversgold committed workplan. An extensive
diamond drilling programme was completed in August 2023 which substantiated
previous exploration work, with very wide zones of intense alteration in all
four diamond drill holes demonstrating high gold prospectivity. The Company
is currently awaiting assay results and will report these to the market in due
course.
The Riversgold transaction highlights Oracle's strategy of forming
partnerships to create value for shareholders and the Company is optimistic
about the development of the partnership moving forwards.
With regard to Jundee East, the results of our exploration programme did not
warrant any further work and the value of the asset was impaired in 2022.
Outlook
During the first half of 2022, we actively pivoted towards a more
environmentally responsible project development strategy, by selecting green
energy development to be a part of our portfolio. This has continued into
2023 and the Company is also reviewing other global green energy opportunities
with His Highness Sheikh Ahmed Dalmook Al Maktoum.
We remain determined to generate value from the investments that we have made.
We have launched another significant renewable power project to create further
development opportunities on our coal block in Thar. At the same time, with an
eye on critical energy needs and market demand, we have also forged a
strategically valuable off-take partnership for coal to power and are now
working towards securing financing support for our coal to power project under
the CPEC umbrella.
The last six months have taken us further forward in terms of progressing our
strategic vision and project developments and we are committed to continuing
this progress going forward.
Naheed Memon
Chief Executive Officer - Oracle Power PLC
Date: 25 September 2023
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS TO 30 JUNE 2023
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
CONTINUING OPERATIONS £ £ £
Revenue - - -
Administrative expenses (621,197) (356,538) (1,311,012)
OPERATING LOSS (621,197) (356,538) (1,311,012)
Finance costs - - -
Finance income 7,424 243 14,592
Amounts written off and p/l on disposals - - 6,762
LOSS BEFORE INCOME TAX (613,773) (356,295) (1,289,658)
Income tax - - -
LOSS FOR THE PERIOD (613,773) (356,295) (1,289,658)
Earnings per share expressed in pence per share:
Basic (0.02) (0.01) (0.04)
Diluted (0.02) (0.01) (0.04)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS TO 30 JUNE 2023
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
£ £ £
LOSS FOR THE YEAR (613,773) (356,295) (1,289,658)
ITEMS THAT WILL OR MAY BE RECLASSIFIED TO PROFIT OR LOSS:
Exchange gains arising on translation on foreign operations (331,076) (35,456) (178,459)
OTHER COMPREHENSIVE LOSS FOR THE PERIOD, NET OF INCOME TAX (331,076) (35,456) (178,459)
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD (944,849) (391,751) (1,468,117)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE SIX MONTHS TO 30 JUNE 2023
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
£ £ £
ASSETS
NON-CURRENT ASSETS
Intangible assets 4,688,947 5,640,968 5,023,296
Property, plant and equipment 2,615 4,948 3,885
Investments in equity accounted associates 667,337 120,284 668,782
Loans and other financial assets 619,773 435,871 580,079
5,978,672 6,202,071 6,276,042
CURRENT ASSETS
Trade and other receivables 39,427 73,530 45,069
Cash and cash equivalents 326,946 762,300 150,905
366,373 835,830 195,974
TOTAL ASSETS 6,345,045 7,037,901 6,472,016
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 3,695,415 2,896,479 3,078,297
Share premium 18,807,922 18,358,858 18,632,040
Translation reserve (1,326,201) (852,122) (995,125)
Share scheme reserve 67,896 66,733 58,179
Retained earnings (15,127,899) (13,579,600) (14,504,409)
TOTAL EQUITY 6,117,133 6,890,348 6,268,982
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 227,912 147,553 203.034
Borrowings - - -
TOTAL LIABILITIES 227,912 147,553 203,034
TOTAL EQUITY AND LIABILITIES 6,345,045 7,037,901 6,472,016
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2023
Called up Retained earnings Share Translation Share Scheme Reserve Total Equity
share premium Reserve
capital
£ £ £ £ £ £
Balance at 31 December 2021 2,650,325 (13,223,305) 17,853,012 (816,666) 66,733 6,530,099
Loss for the period - (356,295) - - - (356,295)
Other comprehensive income - - - (35,456) - (35,456)
Issue of Share Capital 246,154 - 505,846 - - 752,000
Balance at 30 June 2022 2,896,479 (13,579,600) 18,358,858 (852,122) 66,733 6,890,348
Loss for the period - (933,363) - - - (933,363)
Other comprehensive income - - - (143,003) - (143,003)
Share warrants expired - 8,554 (8,554) -
Issue of Share Capital 181,818 - 273,182 - - 455,000
Balance at 31 December 2022 3,078,297 (14,504,409) 18,632,040 (995,125) 58,179 6,268,982
Loss for the period - (613,773) - - - (613,773)
Other comprehensive income - - - (331,076) - (331,076)
Share warrants granted - (9,717) 9,717 -
Issue of Share Capital 617,118 - 175,882 - - 793,000
Balance at 30 June 2023 3,695,415 (15,127,899) 18,807,922 (1,326,201) 67,896 6,117,133
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
£ £ £
Cash flows from operating activities
Cash used in operations CF note 1 (388,338) (458,199) (707,714)
Net cash used in operating activities (388,338) (458,199) (707,714)
Cash flows from investing activities
Purchase of intangible fixed assets (39,199) (262,283) (378,963)
Purchase of investments in associates - (120,284) (668,782)
Issue of loans (193,747) (20,683) (184,929)
Interest received 7,424 243 14,592
Net cash used in investing activities (225,522) (403,007) (1,218,082)
Cash flows from financing activities
Proceeds of share issue 793,000 752,000 1,207,000
Net cash from financing activities 793,000 752,000 1,207,000
Increase / (decrease) in cash and cash equivalents 179,140 (109,206) (718,796)
Cash and cash equivalents at beginning of period CF note 2 150,905 872,000 872,000
Effect of exchange rate changes (3,099) (494) (2,299)
Cash and cash equivalents at end of period CF note 2 326,946 762,300 150,905
NOTES TO THE CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2022
1. RECONCILIATION OF LOSS BEFORE TAX TO CASH USED IN OPERATIONS
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
£ £ £
Loss before tax (613,773) (356,295) (1,289,658)
Depreciation 103 103 205
Impairment loss on intangible assets 17,224 - 579,728
Impairment loss on loans to associates 145,230 - 25,785
Loss/(Gain) on foreign exchange movement 41,782 (55,575) 10,300
Finance income (7,424) (243) (14,592)
Share of loss from associate undertaking 1,444 - -
Gain on disposal of subsidiary undertaking - - (6,762)
(415,414) (412,010) (694,994)
Increase in trade and other receivables (18,340) (23,422) (38,025)
Increase / (decrease) in trade and other payables 45,416 (22,767) 25,305
Cash used in operations (388,338) (458,199) (707,714)
2. CASH AND CASH EQUIVALENTS
The amounts disclosed on the cash flow statement in respect of cash and cash
equivalents are in respect of the statement of financial position amounts:
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
£ £ £
Cash and cash equivalents 326,946 762,300 150,905
NOTES TO THE FINANCIAL STATEMENTS - UNAUDITED RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2023
1. Basis of preparation
These interim financial statements for the six-month period ended 30 June 2023
have been prepared using the historical cost convention, on a going concern
basis and in accordance with applicable UK adopted International Financial
Reporting Standards and IFRIC interpretations and with those parts of the
Companies Act 2006 applicable to reporting groups under IFRS. They have also
been prepared on a basis consistent with the accounting policies expected to
be applied for the year ending 31 December 2023, and which are also consistent
with the accounting policies applied for the year ended 31 December 2022
except for the adoption of any new standards and interpretations.
These interim results for the six months ended 30 June 2023 are unaudited and
do not constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The financial statements for the year ended 31 December
2022 have been delivered to the Registrar of Companies and filed at Companies
House and the auditors' report on those financial statements was unqualified
but contained an emphasis of matter in respect of a material uncertainty
relating to going concern. The auditors' report did not contain a statement
made under Section 498(2) or Section 498(3) of the Companies Act 2006.
2. Loss per share
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares of
3,311,808,627 (30 June 2022: 2,795,197,507 and 31 December 2022:
2,902,488,933) outstanding during the period. There is no difference between
the basic and diluted loss per share.
3. Called up share capital
(Unaudited) (Unaudited) (Audited)
6 Months to 6 Months to Year ended
30 June 2023 30 June 2022 31 Dec 2022
Allotted, called up and fully paid
Ordinary shares of 0.1p each 3,735,415,387 2,896,479,558 3,078,297,740
The number of shares in issue was as follows:
Number of shares
Balance at 31 December 2021 2,650,325,712
Issued during the period 246,153,846
Balance at 30 June 2022 2,896,479,558
Issued during the period 181,818,182
Balance at 31 December 2022 3,078,297,740
Issued during the period 657,117,647
Balance at 30 June 2023 3,735,415,387
For further information please contact:
Oracle Power PLC +44 (0) 203 580 4314
Naheed Memon
Strand Hanson Limited (Nominated Adviser and Joint Broker) +44 (0) 20 7409 3494
Rory Murphy, Matthew Chandler, Rob Patrick
Global Investment Strategy UK Limited (Joint Broker) +44 (0) 20 7048 9432
Samantha Esqulant
St Brides Partners Limited (Financial PR) +44 (0) 20 7236 1177
Susie Geliher, Isabel de Salis
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